Schwarzenegger unveils revised budget proposals

Gov. Arnold Schwarzenegger on Thursday released his revised budget plans to address the state???s worsening deficit.

One of the two proposals pegs the state???s deficit for the 2009-10 fiscal year at $15.4 billion if three of six ballot measures pass next week. The other lays out the bigger budget gap the state would face if they don???t pass.

The passage of Propositions 1C, 1D and 1E in the special election May 19 would provide $5.9 billion in general fund revenue.

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Without the extra funds, California???s budget deficit would stand at $21.3 billion, the governor said in a news release.

He said some cuts will need to be made regardless of whether the ballot measures pass.

???To solve our immediate cash crisis, we simply cannot avoid deep and painful cuts in spending. Some of these solutions are things I would never have considered in the past but, unfortunately, our state could be in a worst case scenario if the propositions fail,??? Schwarzenegger said in a news release.

His proposals include:

• Reducing education spending by $3 billion, which would mean shaving five days off the school year, teacher layoffs and increased class sizes
• Obtaining up to $6 billion through a Revenue Anticipation Warrant
• Reducing funding for Healthy Families, rolling back the rate increase for family planning services and reducing Medi-Cal payments to private hospitals by 10 percent
• Delaying all repairs to the state Capitol for a year.
• Reducing funding for the University of California and California State University systems

Deeper cuts would be needed if the propositions fail.

The governor???s additional proposals include:

• Cutting $2.3 billion more from education, which would further shorten the school year and require more teacher layoffs
• Further cuts for the UC and CSU systems
• Further reducing funding for public health and social service programs
• Borrowing $2 billion from local governments
• Releasing thousands of undocumented immigrant inmates into federal custody, which would save the state more than $100 million.

The governor also said his administration would send 5,000 layoff notices Friday to state employees in various departments and agencies.

He announced earlier this week that he wants to sell off some of the state's assets to raise money, including Cal Expo in Sacramento and San Quentin State Penitentiary in Marin County.